Barbados and Caribbean neighbours considering fund to help private sector companies in their countries who are facing financial trouble.
Barbados Prime Minister David Thompson and his counterparts from several Caribbean countries are considering the establishment of a multi-million dollar fund to help financially-troubled business entities in their states to weather the current economic storm.
The leaders, including Trinidad and Tobago’s Patrick Manning, St. Vincent’s Dr. Ralph Gonsalves, Grenada’s Tillman Thomas, St. Lucia’s Stephenson King and Dominica’s Roosevelt Skerrit, met March 4th, 2009, at the Barbados Hilton Hotel.
The meeting came on the heels of the Trinidad and Tobago government’s decision in February to seize control of the CLICO Investment Bank, as part of a bailout of companies belonging to the Port of Spain conglomerate CL Financial, which has subsidiaries in Barbados and elsewhere in the region.
Dr. Gonsalves, who chaired the meeting, said afterwards that under consideration is an idea that “some resources from the CARICOM Petroleum Facility would be put towards such a regional fund in respect of providing some liquidity in those jurisdictions where there may be (financial) difficulties.”
The meeting also came against the backdrop of major regional fallout from a US decision to freeze the assets of companies owned and operated by Texan billionaire Allen Standford, who has substantial holdings in Antigua and Barbados.
Gonsalves explained that the plan is to use the fund to provide liquidity “in times of difficulties with any particular entity in any particular country.”
He said that each government at the Barbados meeting had given assurances that their regulatory agencies would meet on an ongoing basis to coordinate their work and to enhance the stability of the Caribbean financial system.
The St. Vincent Prime Minister said that one of the lessons learnt from the CLICO troubles was that there needed to be more cooperation on the matter of regulation.
He added: “(there was consensus) that a crisis is a terrible thing to waste and that we all have to work together, so that a lasting and enduring legacy would be a deepening of the process of regional integration.”
CLICO Barbados Life Insurance Company, a subsidiary of the Trinidad CL Financial group, has been found (in 2007) to be $93 million short of its financial commitments under the Barbados statutory fund requirements for such companies.
March 7th, 2009